Ireland’s Crackdown on White-Collar Crime: A New Era for Corporate Accountability
In recent years, Ireland has undergone significant reforms to strengthen its laws and enforcement mechanisms against white-collar crime, including cartel activity, corruption, money laundering, and terrorist financing. The country is now poised to take a tougher stance on corporate accountability, with increased scrutiny of directors and executives.
Cartel Activity
Under the Competition Act 2002, cartel activity such as price fixing can carry criminal penalties of up to ten years’ imprisonment for individuals and fines of up to €5 million or 10% of turnover for undertakings. Company directors convicted of an offence face automatic disqualification from acting as a director for five years.
Corruption and Bribery
Ireland’s anti-corruption laws were significantly strengthened by the Criminal Justice (Corruption Offences) Act 2018, which introduced new corporate liability offences and extra-territorial effect provisions. The Act also expanded the definition of corruption to include active and passive corruption in relation to office, employment, position, or business.
Money Laundering, Terrorist Financing, and Sanctions
The Fifth Anti-Money Laundering Directive (MLD5) was transposed into Irish legislation by the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021. The Act expanded the category of “designated persons” to include Virtual Asset Service Providers (VASPs), which must register with the Central Bank of Ireland.
Future Developments
- The Competition and Consumer Protection Commission (CEA) is expected to increase its investigative powers and enforcement activities in the coming years.
- A public consultation is currently underway on the proposed Companies (Corporate Enforcement and Regulatory Provisions) Bill 2023, which aims to enhance corporate governance and company law enforcement.
Deferred Prosecution Agreements
The Irish Law Reform Commission recommended the introduction of Deferred Prosecution Agreements (DPAs), similar to those used by UK agencies. While DPAs have not yet been introduced in Ireland, it remains unclear whether the CEA has the appetite to see their introduction in the near future.
Increased Focus on Personal Accountability
Ireland’s strengthening corporate crime framework has serious implications for directors of Irish companies. The CEA has issued warnings about personal criminal liability for directors who fail to take an active role in company management or act as mere signatories to company documents.
Conclusion
As the regulatory landscape continues to evolve, companies and individuals should be prepared for increased scrutiny and enforcement. It is essential to seek specialist advice on corporate accountability and white-collar crime matters.
Contact a member of our team today to learn more about how these changes may affect your business or personal interests.